Consumer Alert:

04/12/2005

TALLAHASSEE – Florida's Chief Financial Officer Tom Gallagher today urged Floridians interested in signing up for a medical discount card plan to verify it is licensed to do business in the state. Legislation passed last year requires companies selling plans in Florida be licensed as of March 31, as well as the agents selling the plans must be disclosed.

"This is an industry where the potential for rampant fraud was great. Too many Floridians were being ripped off by unscrupulous operators, and many were made to think they were buying health insurance when in fact they were signing up for discounts on medical services or prescriptions," said Gallagher, who oversees the Department of Financial Services. "Consumers who are presently paying for a discount medical plan or are considering signing up for one need to Verify Before You Buy."

Discount medical plans can no longer use the word "insurance" in their advertising or in their paperwork. They also cannot use terms that may confuse a consumer into thinking a plan is insurance such as guaranteed issue, co-payments, coverage, health plan, enrollment or premium. Discount card plans only offer a reduction in the cost of a prescription or medical service.

Discount medical plans must file any contract language with the Office of Insurance Regulation and they must list all discounts and fee schedules included in the plan. They also must disclose their network of doctors and services. In addition the plans must meet new financial solvency requirements to operate in Florida.

To verify that a plan is authorized go to www.fldfs.com or call 1-800-342-2762. A list of the discount medical plans that are currently licensed is below.

Consumers interested in signing up for a discount medical plan should consider the following:

• Consumers are often required to pay a monthly fee of up to $100.

• Ask about the plan's cancellation and refund policies - be wary of plans that ask you to pay the entire yearly fee up front. Also, check for hidden costs or fees.

• Call some of the providers listed in the plan. There have been instances where physicians were unaware they were listed by discount card sellers.